DishServe Cloud Kitchen Startup Close

Startups cloud kitchen DishServe announced bankruptcy. One reason is because they do not have runway sufficient to continue operating, while the company is unable to convince investors that this business can grow positively in the long term.

This information was first announced by DishServe CEO Rishabh Singhi via a post uploaded on LinkedIn yesterday (01/5). He shared, "An amazing journey has come to an end. It is with great sadness that I want to announce that we have closed DishServe," he wrote.

A number of achievements and lessons learned during his pioneering DishServe were also presented in 2020. These include:

1. Fully automated food production plant. Had no prior manufacturing experience and set up a fully functional production facility within three months.
2. Has a network of more than 200 kitchen partners, purely with a partnership model, so asset-light and is probably the cheapest way to operate cloudkitchen.
3. Launched and increased various healthy food brands that bring affordability, accessibility and taste to customers in 10 cities in Indonesia, serving more than 100 thousand customers.

This positive achievement turns out to be disproportionate to the reality in the field. He detailed three issues he hopes can be resolved:

1. Originally margin DishServe is low, while its focus is pursuing growth. As a result, the company spends most of it runwayit's for that. By the time it starts pursuing increased margins, the remainder runway it's too little.
2. The narrative about F&B is considered boring, not so sexy anymore in the eyes of today's VCs. Ultimately, the company couldn't convince enough people that the DishServe business could scale to a $100 million ARR business in the next 5-6 years.

"Lastly, we were trying to solve too many problems, from brand creation to supply chain and distribution to food production. We could have focused on one of them and started monetizing it earlier," concludes Singhi.

When contacted further by DailySocial.id, Singhi is still reluctant to provide further statements, regarding the effective closure of operations, affected employees, and his next plans. He only said that he still needed time to digest all the decisions he had taken.

Prior to building DishServe, Singhi served as COO of RedDoorz for almost five years.

Now DishServe's social media accounts have been deleted, and the site can no longer be accessed.

The company has pocketed A pre-series funding from a number of investors, including Genting Group, Insignia Venture Partners, Stonewater Ventures, Ratio Ventures, Rutland Ventures, 300x Ventures, MyAsiaVC, and several angel investors. In 2020 they also received initial funding from Insignia.

Time to announce it pivot

Before making this decision to close, DishServe announced the pivot focuses on providing operational automation solutions for restaurants, cafes and kitchens specifically for delivery services (online delivery). Before being firm with this decision, trials had been carried out since July 2022, then completed three months later, to be precise, September 2022.

The target users are also broad, not limited to home culinary businesses, but also businesses on a higher scale. Not to mention businesses that already have a shop presence offline is also not immune from being targeted, so DishServe is not completely dependent on the food delivery business alone (delivery only).

To serve segments delivery only, the company has built a series of F&B brands focused on producing high-quality food with increased access, affordable prices and great taste. The DishServe brand is claimed to be able to increase consumer reach with a mass manufacturing scheme in factories, thereby reducing production costs while maintaining consistent quality.

The DishServe brand is all about healthy food. The names are KitFit, LIT, Uncle Tam, Bing Bing, and Chickass.

As for initial business DishServe is about providing home kitchen facilities or underutilized kitchen assets as part of a network to act as last mile distribution points for F&B brands. As a marketplace, DishServe makes it easy for brand owners to develop without fixed costs through DishServe's infrastructure.

Additionally, home kitchens can also earn additional income by acting as last-mile distribution points. Thus, consumers who like brands that are members of DishServe can be helped because they can easily buy food in less than 10 minutes delivered from their nearest point.